Avient Corporation Reports $20.2 Million Net Loss in Q1 2025

Avient Corporation reported a net loss of $20.2 million for the first quarter of 2025, a significant decline from the net income of $49.4 million recorded in the same period of 2024. The company's revenue for the quarter was $826.6 million, slightly down from $829.0 million year-over-year. The decrease in sales was attributed to unfavorable foreign currency impacts of 2.1%, although sales excluding these impacts increased by 1.8%, primarily driven by growth in the packaging and healthcare sectors. The gross margin also fell to 31.8% from 33.6%, largely due to increased restructuring charges and a shift in sales mix.

The company's selling and administrative expenses surged to $262.5 million, up from $184.2 million in the prior year, primarily due to a $71.6 million impairment charge related to the cessation of its cloud-based enterprise resource planning system, S/4HANA. Additionally, the company incurred $14.7 million in charges associated with unpaid contractual obligations for hosting fees. These factors contributed to a drastic reduction in operating income, which fell to $0.7 million from $94.0 million in the previous year.

Operationally, Avient's two reportable segments, Color, Additives and Inks, and Specialty Engineered Materials, experienced mixed results. The Color, Additives and Inks segment saw a slight increase in sales to $519.7 million, while the Specialty Engineered Materials segment reported a decline to $308.4 million. The overall operating income for the Color segment improved by 5.1%, whereas the Specialty segment's operating income decreased by 11.8%. The corporate segment, however, reported a substantial loss of $125.0 million, reflecting the aforementioned impairment and restructuring costs.

As of March 31, 2025, Avient's total assets remained stable at $5.811 billion, with cash and cash equivalents decreasing to $456.0 million from $544.5 million at the end of 2024. The company reported a total debt of $2.099 billion, with a weighted average interest rate of 6.27%. Avient's liquidity position, including cash and available credit, was $711.1 million, which the company believes will be sufficient to meet its cash requirements for the foreseeable future.

Looking ahead, Avient is focused on executing its restructuring program related to the integration of Clariant Color, which is expected to yield cost savings and improved efficiency by the end of 2025. The company anticipates incurring approximately $70 million in charges related to this restructuring, with $62.3 million already recognized. Despite the challenges faced in the first quarter, Avient remains committed to its strategic initiatives and aims to enhance its operational performance in the coming months.